Dropshipping vs. affiliate marketing!
Which is the best way to make money online?
Great question!
I personally use both business models. Combined, they make up for 90%+ of my monthly income online so it’s safe to say I have quite a bit of experience with the two.
Both dropshipping and affiliate marketing allow you to sell without having to create or store the product yourself.
Dropshipping vs. Affiliate Marketing: Which One Makes The Most Money?
To help you understand which method is best for you, I will be explaining each business model, along with the pros and cons of each.
We’ll start with affiliate marketing and then move on to dropshipping.
Last but not least, I will also tell you which questions you need to ask, so you can figure out – for yourself – whether dropshipping or affiliate marketing is the business model you want to go with.
What is Affiliate Marketing?
Affiliate marketing is for those who want to make extra cash by promoting products related to the content of their channel. For example…
Food bloggers might talk about specific ingredients their readers can buy online.
Beauty & fashion bloggers love to mention their favorite clothing stores.
Why not make take the opportunity to make money when you encourage a reader to buy a product?
You can sign up to become an affiliate for many of the world’s biggest brands through what we call an affiliate program.
The Benefits of Becoming an Affiliate Marketer
Mutually beneficial:
Online shops want you to market their products, and you want a cut of the money they make. Rather than it is a case of you paying someone else (i.e a supplier) to do your work, you have a retailer who supports you as you help them.
Amazon has a great affiliate program where you not only get paid when someone buys a product you advertised, but also if they buy any qualifying products having entered the site through your affiliate link.
No time needed:
All it takes to start earning money through affiliate selling is to sign up, publicize your link and get people to buy products! You don’t need to liaise with suppliers, design products, or create any kind of seller website.
Neither do you need to deal with any customer queries or complaints—they aren’t your customers! You are simply promoting products of your choice to your established audience.
Flexibility:
All it takes is posting a link. You can put this in a blog post, in the description of a YouTube video, or a social media post.
Of course, each company will have their terms and conditions for how you need to behave, but generally, you can sign up to whoever you like, or move to a different company if you don’t feel like it’s working.
The Disadvantages of Affiliate Marketing
No control:
When it comes to affiliate selling, you’re relying on someone else to close the sale.
You don’t make money unless the product is bought, but don’t have any ability to influence whether they buy it after they have left your site.
Bad connection:
If a customer has a bad experience with the vendor you send them to, it may hurt your reputation.
While with dropshipping it’s down to you to apologize for any issues, with affiliate selling, you’re relying on the vendor to do a good job without even the ability to help a customer if something goes wrong.
The same applies to if the company you promote get any bad press—that bad press may get reflected back to you as an affiliate.
What is Dropshipping?
When you want to sell a specific product without the hassle of producing it yourself, you can choose to start dropshipping merchandise.
When a customer purchases a product from you, you will then order it from a separate retailer who will then ship it to the customer.
While it appears similar to a standard retail model from the outside, you only have to worry about making sales rather than any stock or shipping requirements.
You can even get extra help to start up your dropshipping venture; Shopify can help you start selling risk-free with a free trial, while eCom Elites is a training course that provides training for every step.
The Benefits of Dropshipping
Build your brand:
You get to choose exactly what you want to sell and can choose a selection of products to make your shop feel like your own.
Customers will come to you to buy products without you promoting another seller or third party.
Dropshipping allows the focus of the enterprise to be on you—it not only works as a method of making money but also builds the status and credibility of your brand.
Gain without hassle:
You can run your business from anywhere, stock any products you want, and never have to think about the logistics of it.
If you want to scale your business, it’s very easy to do so.
Traditionally more business would mean more work for you, but dropshipping means that you can simply pass the work onto your suppliers.
The Disadvantages of Dropshipping
Customer service:
You are the face of the whole operation. Your customers don’t care who is responsible for what part of the supply chain—all they want to know is that they get what they have paid for.
You will have to take responsibility for any supplier errors, shipping problems.
You’ll need to make sure you have a good quality, a trustworthy supplier to reduce the risk of anything going wrong, but still, you will need to be prepared to apologize for issues and do what you can to resolve them.
Small change:
Most of the money your customers spend goes to the third party supplier who then made their own small profit from it.
While you personally don’t have to dish out for overhead charges, you pay for it in the long run by making a smaller amount of money yourself.
Higher prices:
Additionally, as your supplier is charging a set amount for their services, you have very little control over the item’s end cost.
You need to make money from your dropshipping venture for it to be worth it, but this all drives up costs for your customers. This may, unfortunately, mean you sell fewer products than you would like.
Dropshipping vs. Affiliate Marketing: Which Is The Best Option For YOU?
If you’re looking to sell a set range of products based on your brand then dropshipping is probably better for you.
Otherwise, it’s far easier to become an affiliate with a brand, especially if you already mention products on your blog.
You have far more flexibility, and it’s a great way of starting out with selling products!
How I Make Money With Both Dropshipping & Affiliate Marketing
You can see how I make money with dropshipping here,
and, you can also see how I make money with affiliate websites here.
I’ll leave you to it.
